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of deficiency regarding the estate and gift tax deficiencies on
September 20, 1994.
Petitioner contends that
the previous ownership position of Respondent's
predecessor as well as notification and subsequent
acquiescence over a 12-year period by respondent
following the filing of extensive income and gift tax
returns by Birnie M. Davenport and her relatives allow
Petitioner to assert that Respondent is under a 'duty
of consistency' or is 'quasi estopped' to assert any
gift or estate tax deficiency against Petitioner for
gifts of Hondo stock by Birnie M. Davenport.
We disagree. The filing of the Federal estate and gift tax
returns by Birnie's estate started the running of the periods of
limitations on November 7, 1991. Respondent's notices of
deficiency were mailed to petitioner on September 20, 1994,
before the expiration of the period of limitations. We therefore
find that the statute of limitations does not bar the assessment
of additional estate and gift tax liabilities in this case.
Addition to Tax Under Section 6651(a)(1)
Section 6651(a)(1) imposes an addition to tax for failure to
file a return on the date prescribed (determined with regard to
any extension of time for filing), unless it is shown that such
failure is due to reasonable cause and not due to willful
neglect. The taxpayer has the burden of proof to show the
addition is improper. United States v. Boyle, 469 U.S. 241, 245
(1985).
Respondent determined that a Quarterly Gift Tax Return with
respect to the July 1980 gifts was due to be filed on November
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